What does Politically Exposed Person (PEP) mean?
PEP stands for "Politically Exposed Person." This term describes individuals who, due to their public functions, have a higher risk of potential involvement in corruption and money laundering. Typically, this includes: - Heads of state, government officials, judges of the highest court, high-ranking military personnel, leading party members, key executives of state-owned enterprises, as well as family members and close associates of the aforementioned groups.
Financial institutions and other obligated entities under anti-money laundering laws are required to identify their customers and determine if they are PEPs. If a customer is identified as a PEP, stricter due diligence and monitoring measures are required to manage the increased risk.
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